Professional Documents
Culture Documents
H K , 9.60) is currently trading at a P/E of 13.8 and has maintained cash flow growth of more than 26%. The company has more than 1,600 Hong Kong retail outlets and a strong presence in 320 cities on the mainland. High-end fashion apparel and accessories are also fertile ground for investors. In fact, PRADA spA 09i3.
about brands, prices and quality. Forget the commonly held belief that the Chinese love counterfeit goods. This is a big change from just a few years ago when people would buy just about anything with a certain logo on it. My research firm specializes in "man on the street" interviews. One striking ohservation we recently made was a sharp drop in aspiration for foreign brands versus domestic brands in certain categories. Chinese consumers increasingly want to buy local, especially when it comes to sportswear and cellular handsets. These manufacturers tend to be more nimble in adapting to local tastes at appropriate price points. Local brands like Nike-knockoff sportswearmaker LI NING (2331.HK, 4.37) are taking market share. Li Ning was founded by a former Chinese gymnast who won six medals at the 1984 Olympic Games in Los Angeles. The company, named afrer its founder, has about 8,300 retail stores and is one of
CHINESE CONSUMERS' TASTE FOR LUXURY NOW EXTENDS TO LOCAL BRANDS, TOO
HK, 57.20) and French toiletries maker
L'OCCITANE INTERNATIONAL SA (0973.HK, 18.72)
went so far as to list their stocks in China. MICHAEL KORS (KORS, 5O), which trades on the NYSE, is another red-hot favorite among Chinese. It recently opened its fifrh, and largest, store in China and expects to open 15 more by the end of the year. There are some important things to keep in mind when investing in Chinese luxury stocks. First, the Chinese are well-informed
the best-known brands in China. Its stock trades at a P/E of 14.9 and five times cash now. Other local brands to watch are Kweichow Moutai and privately held fashion and bridal gown maker Ne-Tiger. Investors would be wise to tap into Chinese demand for luxury. Most brokers can help you buy Hong Kongtraded shares. But keep an eye on local competition. The Chinese have a saying: "If a string has one end, then it has another end." O
'S. HE IS ALSO THE
62
Copyright of Forbes is the property of Forbes Inc. and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use.